Innovative Industrial Properties (IIPR) reported its second-quarter earnings results yesterday after the market closed. The results came in strong for the quarter. At 2:33 PM ET today, the stock was trading 1.2% lower.

For fiscal 2019’s second quarter, IIPR reported a 155% year-over-year increase in rental revenue to approximately $8.3 million. The company explained in its press release that acquisitions and leasing new properties drove the increase.

Total sales came in at $8.6 billion for Q2, beating analysts’estimates of $8.3 billion. Sales were higher than Q2 of 2018’s total sales of $3.3 billion. Innovative Industrial Properties’ earnings per share grew 76.4% to $0.30, in line with analysts’ estimates.

IIPR’s increased dividend

IIPR is a specialized REIT. You can track a REIT’s operating performance best through its FFO or (funds from operations) and AFFO (adjusted funds from operations). REIT stocks are popular as high dividend payers. So AFFO is a better measure to determine the cash available to pay out as dividends.

In its second quarter, IIPR reported FFO of approximately $4.7 million and AFFO of approximately $5.8 million, up 176% from the year-ago quarter. On July 15, the company paid a quarterly dividend of $0.60 per share. Last month’s dividend was up 140% year-over-year.

Innovative Industrial Properties’ focus on acquisitions

IIPR is a specialized REIT (or real estate investment trust) that provides real estate solutions to medical cannabis players. In the second quarter, the company made several acquisitions.

It acquired five industrial properties in Southern California.

In April, IIPR acquired a 51,000-square-foot industrial property in Pennsylvania for medical-use cannabis cultivation and processing.

In May, the company acquired an 11,000-square-foot industrial property in Ohio for medical-use cannabis processing.

On July 31, Scotts Miracle-Gro Company (SMG) reported stellar third-quarter earnings, leading to a surge in its stock. The stock is down 2.5% in August as of yesterday. SMG is trading 0.44% higher today. To learn more about SMG, see SMG: How Do Analysts View This Cannabis Stock?

Price coverage for IIPR

After IIPR’s earnings results, three analysts still cover Innovative Industrial Properties. We haven’t seen much change in its price target and coverage yet. Two analysts still recommend a “strong buy” for the next 12 months while one analyst rates IIPR a “hold.” The target price is $164, which represents 57% upside potential compared to the current trading price. IIPR closed at $105.96 yesterday.